Translation:My doctor says that I am not allowed to eat sugar.
"My doctor said I can't eat candy" should also be accepted. There's no indication of tense, but it's more likely that the doctor already told him that, so it would make more sense to say "said" rather than "says." 糖 means both candy and sugar in Chinese. Both should be accepted.
Nothing to do with Chinese, but in English I would think the doctor is telling me to not eat anything with too much sugar, not just candy. So that means juice, soda, ice cream, desserts, and other sweets. It would be crazy to think it is ok to continues eating and drinking all the other sweet stuff and avoid only candy.
This should be in the Health Lesson Group - seems out of place in Transportation section.
Every time I hit this question I try to remember whether the program wants "my doctor said" or "my doctor says". Both are technically correct in English. My doctor did say it, so the past tense is correct. But he is still saying it, so the continuous is also correct. I usually guess wrong and use "said" when the program wants "says". A bit frustrating.
You have mixed tenses in this sentence. You should say, 'My doctor says (now) that I am (now) not allowed to eat sugar." In English, what you have written means. My doctor says (now) that I was (in the past) not allowed to eat sugar. This would imply that you are (now) allowed to eat it.